whats the point of insurance?

Question

If your paying for insurance on a phone, its stolen, you order another one and you have a 50 dollar deductable, but yet the deductable is more than the phone was in the first place. Maybe some one can give me a answer i can understand

Answer 1

Apparently you haven't tried to replace a lost, stolen, or damaged phone halfway through your contract. Sure the phone is 50 bucks or less when you're signing a new contract with them, but that's the only time you can get it that cheap. You don't get the discount without signing or renewing a contract, so the insurance is there for people that are likely to need a new phone before then.

Answer 2

Generally, if you lose your phone and you have to go buy another one it is quite expensive. Say you got that phone with a 2-year contract, more than likely the phone is free or really low cost. If you lose that phone you have to buy it again w/o getting a new contract, this way the company won't give you the deal. Phones w/o signing up for a contract will usually run you more than $200, so the $50 deductible is a pretty good deal. It is a good idea to have insurance on your phone, particularly if you are prone to losing or damaging things!

Just another tip, if your phone breaks through wear and tear, call it in stolen and you can get another one under that insurance. Generally insurance doesn't cover these kind of damages!

Answer 3

Insurance on a cell phone is useless. Most times you can get a used or refurbished unit that is comparable to what you originally had if you lose the phone for less than $100. If you damage the phone most companies will fix it for the deductable price regardless of whether or not you have the insurance. I walked into my local nextel shop and showed them my broken phone. They offered to fix it but it would be a $35 deductable. They didn't even check to see if I had the insurance. They just assumed that I did. So I am assuming that the local stores get extra parts for the phone for about a dime a dozen and then they get to keep whatever they make off of the deductable. And then your premium goes directly to the company so its win-win for the shop and the company while the consumer is paying out on both ends.

Answer 4

In your case it was pure profit for them.

In most cases insurance is to limit losses. I have a 75 dollar phone and no insurance I can easily cover the 25 bucks for a new one if I lose it or break it. My wife has a 400 dollar phone I got the insurance because i will only have to pay 50 instead of 400 if it is gone.

So the bigger the item the better to take insurance.

Hope that helps

Answer 5

Getting insurance on a cell phone is a big mistake for anybody. You pay 5 or 6 bucks a month for the premium and then you pay a 50 deductable for a USED phone and battery. I did this with NEXTEL and hate that company. They provided poor service and took no responsability for the insurance company that they sign you up with. Stay away from SPRINT/NEXTEL and any form of cell phone insurance!

Answer 6

Insurance is for big losses -- not small ones. So, you insure the contents of your entire home, in case of theft or fire or disaster... but if someone for some reason just rips off your phone, this isn't something that you would put in as a claim. You'd only claim if they ripped off your $600 high end cellular phone -- or something that is worth more than your deductible on your policy.

Insurance is to protect you from big financial impacts, and not every little thing.

Answer 7

First of all, when you sign up for a cell phone plan you are getting the phone at a discounted price or even free. That's how they get you to join their company, they don't make money off of the phones that way. If you were to buy the phone through them and already had a contract it will be significantly higher. Go onto ebay.com and take a look at your phone model, if you can get it for cheaper than $50 then cancel it. It is not mandatory. Or you will realize how much more expensive they are than you thought.

Answer 8

I totaly agree with you whats the point of having any insurance. exspecially if you had a law suit and the insurance gets credited for it. and leaves you nothing. so why even pay insurance on a phone that the deductable is more than a phone, thats just how they make their money. they don't care about anyone but themselves to make money so they can survive.

Answer 9

You're finding out the hard way that phone 'insurance' isn't really insurance at all.
And, you are finding that this is bascially a warranty that really isn't worth anything.
If you look, warranties for cell phones like the kind you describe are nothing more but additional profit streams for cell phone companies. They make a LOT of money on them because they hardly ever pay out.

Answer 10

You should not get insurance on an item unless it is worth over $1,000.00. You could, however, get insurance on all of your items under a homeowner's or renter's insurance. In case of a fire, flood, break in etc..

You can get a $10,000 insurance policy for your possessions only.
http://usainsurancequotes.org

Next time a company ask you to get insurance for a phone, radio, etc...Simply say No thank you!